The U.S. Department of Commerce's Bureau of Industry and Security published a temporary final rule requiring that domestically produced battery black mass be sold to buyers located within the United States. The rule, issued under Section 101 of the Defense Production Act following a July 30, 2026 Presidential Determination on Recoverable Critical Minerals and Materials, is scheduled to remain in effect for one year unless adjusted or extended.

Black mass is shredded lithium-ion battery material containing recoverable critical minerals including lithium, nickel, cobalt, manganese, and graphite. Under the rule, the material must remain in the country unless BIS grants an adjustment or exception.

Electra Battery Materials Corporation (NASDAQ: ELBM; TSX-V: ELBM) said the rule supports its strategy to develop U.S. refining capacity for nickel and recycled battery materials. The company said it intends to participate in the rule's 90-day public comment process.

"The United States has built the front half of the battery recycling processing infrastructure faster than the back half," said Trent Mell, CEO of Electra. "This rule begins to correct that imbalance and could create the market conditions needed to crowd in private capital for U.S. refining."

Electra said it is conducting engineering work for a potential battery-grade nickel refinery in the southeastern United States. The proposed facility would process globally sourced mixed hydroxide precipitate and mixed sulfide precipitate, with the potential to incorporate U.S.-sourced black mass over time.

The company stated that any temporary export exemptions under the rule should be narrow, time-limited, and structured to accelerate investment in domestic refining capacity. Electra also said a durable policy framework and capital support would be required to finance and construct refining facilities.

Electra operates a hydrometallurgical refinery complex north of Toronto, where it has processed black mass at plant scale, and holds mineral properties in Idaho's Cobalt Belt.